Smart specialisation of manufacturing industry: Relying on one's own strengths and targeted attraction of FDI

Abstract

The manufacturing industry remains the crucial driving force of the total economic growth and development and of the formation of industrial economy. The previous transformation of the economic system did not create new economic structures. The decline in employment is the consequence of the structural adaptation. The essence of smart specialisation can be found in radical innovations, which are the result of creative combination of technology and the processing sectors. Model RIS3 accelerates entrepreneurial discovery processes. The state should govern the process of smart specialisation; systematic assumptions for the application of RIS3 model are necessary. RIS3 is a continuous process; it is not just an optimal choice at a certain moment. Economic messages are directed in a few directions: firstly, the application of RIS3 concept presents a developmental opportunity for Serbia to catch up with other contemporary industrial flows; secondly, fast-growing domestic companies are relying on their own strengths and are the pioneers of a new economic structure (a research on dynamic entrepreneurship has shown that in Serbia there is 1.7% of companies, i.e. 1,551 companies and 270 gazelles, with the growth potential); thirdly, FDI should be targeted - the advantages of FDI are not automatic and they depend on the characteristics of domestic economy, absorption abilities of domestic companies, sectors and on the whole economy. Joining global value chains is a very significant factor of structural transformations.